Asia Maritime

Asia's Military Spending Fueled by Heightened Tensions With China

April 5, 2016

World military spending on upward course, says new SIPRI study.

China is by far spending the most on its military of any country in the Asia-Pacific region, according to an April 2016 report on trends in military expenditure published by the Stockholm International Peace Research Institute. In 2015, China spent an estimated$215 billion on its armed forces, which constitutes 49 percent of total regional spending on defense. This was more than four times what India, the second-largest military spender in Asia, spent on defense last year.

China spent approximately 1.9 percent of its GDP on defense. With an estimated $215 billion defense budget, a 7.4 percent increase from the previous year, Beijing accounts for 13 percent of the world’s total military expenditure. However, SIPRI cautions that Chinese data on military expenditure is unreliable and difficult to verify.

Meanwhile, in 2015, India’s defense expenditure increased by 0.4 percent to $51.3 billion, making it the sixth largest military spender in the world.

Between the 2006 and 2015, China’s military expenditure grew by 132 percent, with only Indonesia — logging a 150 percent increase — showing greater percentage growth over the same period. “Heightened tensions with China over the South China Sea are reflected in substantial growth in military expenditure in 2015 by Indonesia (16 percent), the Philippines (25 percent) and Vietnam (7.6 percent),” according to the report. Japan, which has accused China of escalating tensions in the East China Sea, also increased its defense spending.

Overall, military spending in the Asia-Pacific region rose by 5.4 percent in 2015, “and by 64 percent between 2006 and 2015, reaching $436 billion in 2015 at current prices and exchange rates,” SIPRI states. With very few exceptions (e.g., Fiji), most Asia-Pacific countries increased defense spending over the last nine years. Interestingly, Afghanistan had to reduce its military expenditure by 19 percent to $199 million in 2015. With foreign aid taken into account, however, Afghanistan’s total military budget amounted to $5.35 billion in 2015.

Russia’s defense spending last year was $66.4 billion, an increase of 7.5 percent from 2014, and up 91 percent compared with 2006. “Actual military expenditure was 3 percent lower in 2015 than originally planned,” the study notes. “In reaction to further falls in the price of oil, the planned defense budget for 2016 is about 9 percent lower in real terms than spending in 2015.” Russia still ranked as the world’s fourth biggest military spender in 2015; Moscow absorbs an estimated four percent of world military expenditures.

Bucking the general trends, “Iran’s military expenditure decreased by 30 percent between 2006 and 2015, with spending in 2015 standing at $10.3 billion,” according to SIPRI. However, this trend may change given the gradual lifting of UN-imposed economic sanctions and a weapons embargo.

Unsurprisingly, the United States remained the world’s biggest military spender in 2015, although its expenditure fell by 2.4 percent to $596 billion last year.